Yesterday, my bank or insurer had me for life. Yet what happens when I have a purchasing bot that can shift my account wherever it finds a better deal?
Sure, it won’t happen as fast as the Silicon Valley hype merchants want us to believe, but taking a 2-5 year horizon its not unrealistic. For every industry, not just banking and insurance. Especially if you consider all the other technology that’s in the pipeline.
While the future is unwritten, it’s clear we’re heading for a world where customer expectations skyrocket and commoditisation spreads everywhere. Where:
- Being fast, effortless, seamless and (hyper-)personalised are table stakes, and premium prices are only paid to brands and vendors who make a difference.
- Consumers and purchasing departments use agents to inform or even do their purchases. While switching costs and system dependencies remain real – especially in B2B – agents can continuously evaluate and trigger change. Computers don't care about relationships, brand halos or legacy decisions. And they're getting smarter by the month.
But we do need to move
Most organisations take 2-3 years to turn a corner, while customers upgrade their expectations based on their last best experience - in any industry.
Which means we need to make a fundamental choice.
I have always said that “The Experience IS the product”. In the past this was rhetorical: to indicate businesses should always start from the customer’s perspective. Yet I’m increasingly being literal. As software automates chores and touchpoints between brands and customers reduce, the only real differentiator left is the experience brands and businesses offer.
In which there are four choices to still capture premium profits.
- Become a transactional genius: This isn’t just about being fast, easy or effortless. This is about becoming THE most efficient, cheapest, fastest, most reliable, effortless choice for customers. Taking hold of what ever job they want to get done and making it happen for them in a way they almost forget it exists and do it at a price and ease that their continuously price-performance scanning bots will like.
- Offer memorable moments: Humans aren’t robots and - faced with infinite choice - we still pay premium for those who create moments worth paying for. Who pamper us. Make us smile. Let us experience awe. We’ll even forgive a little (not much) transactional complexity to make it happen. Being the business or brand that consistently creates these delightful moments and even memories, can create a bit of being the brand that feels “right”
- Be meaningful to the identity and priorities of your customers: Humans have always used products and services to express their personality and priorities. This won’t change any time soon. Which creates room for offers and experiences that go beyond aspirational ads to help customers express their chosen lifestyle and identity. Especially in B2B, where hardly anyone seems to do this.
- Build a long-term transformative relationship: This is where we look beyond the short-term jobs customers want done to help them achieve their deeper aspirations. Where we grow with them, removing barriers and helping them accelerate towards their goal. In a way flipping the loyalty script by proving we are there for them on their journey, in every way they want..
I realise this choice may not be easy
First of all, the multiple positions aren’t mutually exclusive - transactional ease is a minimum standard in all scenarios. Also, each has a very different impact on infrastructure, margins, headcount and commercial focus.
And then I can also see a future where only the two extreme positions - transactional and transformative - will generate the most enduring profit. So regardless of the direction you choose, you may need to keep travelling. Yet for now, there’s still time to evolve.
Still - as markets move faster than organisations - postponing the choice is risky.
Which is why I made this worksheet, which complements the chapter on Customer Transformation in my book The Transformation Code. It’s a discussion piece to help you think, and decide with your team what game you want to play:
- Transactional Genius
- Purveyor of Memories
- Provider of Meaning
- Partner in Transformation
There’s no real right or wrong, except not choosing. That’s a recipe for failure.
Feel free to get in touch. I’m happy to discuss, clarify or help you think.